COS COB, Conn. - Chicken Soup for the Soul Entertainment Inc. (NASDAQ: CSSE), a major player in ad-supported video-on-demand (AVOD) services in the U.S., is addressing a potential delisting from the Nasdaq Capital Market. The company disclosed today that it received a notification on April 18, 2024, from Nasdaq, citing noncompliance due to the delayed filing of its annual report for the fiscal year ended December 31, 2023.
The company, known for its streaming services Redbox, Crackle, and Chicken Soup for the Soul, as well as nearly 170 free ad-supported streaming television (FAST) channels, has filed its overdue 2023 Annual Report on Form 10-K on April 19, 2024, rectifying the delinquency. Despite this action, Chicken Soup for the Soul Entertainment must request a stay of the suspension by April 25, 2024, to maintain its listing, pending a decision by a Nasdaq hearings panel. The company has confirmed its intention to request this stay.
The Nasdaq notice also mentioned that the company is currently taking steps to comply with other Nasdaq rules, as detailed in the Current Reports on Form 8-K filed on March 29, 2024. An appeals hearing is scheduled for May 21, 2024, to discuss the company's plan for regaining compliance.
The announcement comes as the company continues to expand its content offerings through its subsidiaries, Screen Media and Chicken Soup for the Soul TV Group, which create, acquire, and distribute films and TV series. Chicken Soup for the Soul Entertainment also operates a network of approximately 27,800 kiosks throughout the U.S. for DVD rentals and offers a transactional video on demand (TVOD) service.
InvestingPro Insights
As Chicken Soup for the Soul Entertainment (NASDAQ: CSSE) navigates through its compliance issues with Nasdaq, it's important for investors to consider the company's financial health and market performance. According to InvestingPro data, CSSE has a market capitalization of $13.92 million and has experienced a revenue growth of 16.45% in the last twelve months as of Q4 2023. Despite this growth, the company has a negative price-to-earnings ratio of -0.02, reflecting challenges in profitability.
InvestingPro Tips highlight several critical aspects for potential investors. Analysts predict sales growth for CSSE in the current year, which could be a positive sign for the company's future performance. However, the company operates with a significant debt burden and has been burning through cash quickly, which are concerns that investors should not overlook. Moreover, the company's stock has taken a considerable hit over the last six months, with a price total return of -58.84%.
For those looking to delve deeper into Chicken Soup for the Soul Entertainment's financial metrics and strategic outlook, InvestingPro offers an array of additional tips. There are 15 more InvestingPro Tips available for CSSE, which can be accessed at https://www.investing.com/pro/CSSE. Interested investors may use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, offering even more insights to inform their investment decisions.
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